Privatisation of 100 PSUs, including sale of Air India and Ashoka Hotel, and developing 50 train stations with private participation by 2017-end featured in the CII wish-list to Finance Minister Arun Jaitley. Also, CII President Naushad Forbes wants resolution of all pending disputes involving public-private partnership projects to boost investor sentiments and revising private sector investment to help lift the sagging economy.
“By December 2017 we should do three things — we should privatise 100 firms, we should ensure all pending disputes of PPPs are resolved using the Kelkar Committee recommendations and we should have 50 train stations developed by public- private partnership (PPP) mode,” he said. In December 2015, a committee headed by former finance secretary Vijay Kelkar, recommended setting up independent regulators for PPP projects in various sectors and pushed for amendment to the Prevention of Corruption Act to clarify the difference between cases of graft and genuine errors in decision-making.
It had suggested reviewing defunct proposals of public- private partnership (PPP) in infrastructure as well as a rational allocation of risks among various stakeholders in a project, and moving away from the one-size-fits-all approach to PPP model concession agreements (MCAs). The panel had said the government should encourage development of airports, ports and railways through PPP, by ensuring easier funding for projects with long gestation periods.
Forbes also prescribed that the government should look at privatising profit making firms and not just loss making ones. “Privatisation means someone should be willing to buy what you are willing to sell. People would be wanting to buy firms that they have a greater interest in and firms that they see having the right kind of future based on the potential that the firm has. I don’t think there is a line of people outside the door wanting to buy loss making PSUs,” he said.
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Stating that there is no good reason why Ashoka Hotel and Air India should continue to be public sector firms, Forbes said Niti Aayog has identified 74 firms for privatisation. “We have said take those 74 firms and add another 26. Ashoka Hotel could be one of world’s great hotels. Air India used to be one of world’s great airlines, it hasn’t been for many years. And if you want Air India and Ashoka to be among the world’s great firms, then you need among the world’s great management,” Forbes added.